Car title loans are becoming popular every day especially during these tough economic times. This is because they serve as an easier option of getting the financial backing that you need when having an emergency. Unlike conventional loans, you will get a car title loan within the shortest time possible as long as you are a proud owner of a car. With the car acting as collateral, you do not have to worry about your credit score since most lenders will not look into this. Here are some of the things you need to know concerning auto car title loans.
How Car Title Loans Work
Before borrowing an auto title loan, you will need to have enough equity in your car in order to fund the loan. To be precise, you must have paid off any other loan that you had when purchasing the car. However, some lenders will still give you the loan while still repaying the previous one. All it takes is for to find the right lender and the auto title loan will be at your disposal.
The amount of money you can borrow with an auto title loan depends on the value of your car. Alternatively, the lender may decide to use the equity in your car when determining the amount of money to lend you. The higher the value of your car the more money you are going to get when requesting for a car title loan. However, you should not expect to get the full value of your car since most lenders will give up to 50% of your car’s valuation.
Repaying the Loan
In most cases, car title loans are usually a short-term source of funding and may last between 15-30 days. Therefore, you will have to look for the fastest way of repaying back the loan in order to avoid losing your car. Fortunately, you can still roll over the loan if you cannot complete the payment as agreed.
Interest Rates
The interest rates of a car title loan vary with the lender that you are going to choose. Therefore, you should carry out your own detailed research before making the decision to settle on a given lender. This will mean going through customer reviews or even asking your friends and colleagues if you are to find a lender with the lowest interest rates. Alternatively, you can decide to visit the different lenders before determining the best one to go with.
Getting a car title loan is a step in the right direction when you are in urgent need of financial assistance. This is because the loans are processed within the shortest time possible and may be disbursed in about 48 hours. Remember car title loans are just like any other typical loan. For this reason, you must repay it within the agreed time. Failure to do so will only make things hard since the lender may be forced to take your car in order to get the money.